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Facts and Findings

Just Enough – The EU Proposal for a Carbon Border Adjustment Mechanism

by Jan Cernicky

The Commission's draft is only useful as a diplomatic lever. A Carbon Border Adjustment Mechanism (CBAM) must be comprehensive and integrated into the global trading system.

Compared to a global solution or a climate club, a carbon border adjustment (CBAM) is the worst option. However, if the EU does not want to be dependent on the goodwill of other states, it should design a comprehensive border adjustment that is as open as possible for third countries. The leaked draft of the EU Commission on the CBAM is very limited and can thus only have an impact as a threat or as a first step.

By 2030, German CO2 emissions are supposed to decrease by 65 percent compared to 1990 levels. A massive transformation of the economy will be necessary to achieve this. Obviously, this will significantly increase the costs of climate protection. Production in the EU will become more expensive compared to regions that pursue climate protection less ambitiously. As a result, there is a threat of relocating production from Europe to those other regions. The European Commission has recently published a proposal for a CBAM as a protective instrument against so-called carbon leakage.

 

The present brief paper will first give an overview of possible options for the EU to respond to the problem of carbon leakage. In the following, it will point out the need of an instrument for carbon border adjustment. After commenting on the European Commission's leaked draft for introduction of a CBAM this paper concludes that climate diplomacy will remain important even after implementing the CBAM.

 

Read more about this here in the PDF.

About this series

The series informs in a concentrated form about important positions of the Konrad-Adenauer-Stiftung on current topics. The individual issues present key findings and recommendations, offer brief analyses, explain the Foundation's further plans and name KAS contact persons.

 

Dr. Kristin Wesemann

Dr

Leiterin Stabsstelle Strategie und Planung

Kristin.Wesemann@kas.de + 49 30 26996 3803

Marianne Graumann

Teamleiterin Publikationen, Print und Qualitätssicherung

marianne.graumann@kas.de +49 30 26996 3726 +49 30 26996 53726